As weak GDP growth and stagnant consumer spending raise alarms, institutions are proactively trimming equity exposure and exploring downside hedges. Despite strong orders in core durable goods and low jobless claims suggesting pockets of strength, the conflicting economic signals highlight an impending slowdown, prompting market participants to adjust strategies ahead of a potential sentiment shift.
“The US economy lost momentum in the fourth quarter, with growth coming in below expectations, signalling a sharper-than-anticipated slowdown even as inflation remained broadly stable.”
“Wage growth among higher-income US households is now outpacing lower-earning cohorts by the widest margin in over a decade, according to an analysis by the Bank of America Institute.”
“Recurring applications for US jobless benefits fell to the lowest level in almost two years, adding to evidence of stabilization in the labor market.”
“The ECB is prepared to respond if the Iran war drives inflation away from its 2% target, according to Governing Council member Olaf Sleijpen.”
“US consumer spending barely rose in February against a backdrop of persistent inflation...”
“Germany's industrial output dropped 0.3% from January, with construction and consumer goods driving the decline”
“Sentiment among Japan’s households deteriorated by the most since the early stages of the Covid pandemic following the outbreak of the war in Iran.”
“German factory orders rebounded less than expected in February before the start of the Iran war.”
“as booming semiconductor exports lifted the goods balance before the Iran war began to ripple through energy markets...”
“Japanese workers’ wages adjusted for inflation rose at the fastest pace since 2021.”
“US orders for business equipment rebounded in February, suggesting companies were moving forward on investment plans before the Iran war.”
“Japan’s households reduced spending for a third straight month even after real wages turned positive.”
